The idle offshore fleet - A thesis on causes to and effects of laid up ships within the Norwegian offshore industry

Due to large oil supply and stagnating demand the oil price significantly decreased in 2014, leaving many actors in the offshore industry with a hard time finding profitability in their business. Among these actors are the many ship-owners who operate so called offshore supply vessels (OSV: s). These vessels are used to supply the offshore installations of the oil companies and assist with services such as anchor handling, tugging and repair & maintenance. The activity of the offshore installations in Norway has, since the oil price collapse, decreased to the extent that many of the vessels owned by Norwegian ship-owners no longer have enough work to cover their operating expenses. Ship-owners have therefore chosen to put vessels in lay-up. A lay-up means that a ship is temporarily taken out of service for a longer period, awaiting increased rates on the market. The thesis has studied the causes behind the laid up OSV-fleet in Norway, which effects the lay-ups have had on the concerned market and what expectations the industry has on the future.
The ship-owners and shipbrokers active in the Norwegian offshore industry interviewed for this thesis have given a unanimous view of the current market situation as a supply-and-demand issue. Too many vessels in combination with too many ship-owners have contributed to a very high competition which has led to low rates on the spot market and difficulties finding long-term contracts. Out of the about 600 vessels in the Norwegian OSV-fleet, about150 have been laid up. The lay-ups have had a positive, but small, effect on the tough situation that the ship-owners are in, but there is a long way left until the market is in balance again. Moreover, bankruptcy and consolidation among ship-owners have occurred and are expected to continue. There are different opinions regarding whether a further increased oil price or not is what is needed for the ship-owners to regain profitability. None the less, there is a common opinion amongst the ship-owners that the oil companies’ activities must increase is the market is to be stabilised.

BibTeX @misc{Brattåsen2017,author={Brattåsen, Nicole and Yahyaei Fard, Melissa},title={Den vilande offshoreflottan - En studie över orsaker till och effekter av fartygsuppläggning inom den norska offshorebranschen},abstract={Due to large oil supply and stagnating demand the oil price significantly decreased in 2014, leaving many actors in the offshore industry with a hard time finding profitability in their business. Among these actors are the many ship-owners who operate so called offshore supply vessels (OSV: s). These vessels are used to supply the offshore installations of the oil companies and assist with services such as anchor handling, tugging and repair & maintenance. The activity of the offshore installations in Norway has, since the oil price collapse, decreased to the extent that many of the vessels owned by Norwegian ship-owners no longer have enough work to cover their operating expenses. Ship-owners have therefore chosen to put vessels in lay-up. A lay-up means that a ship is temporarily taken out of service for a longer period, awaiting increased rates on the market. The thesis has studied the causes behind the laid up OSV-fleet in Norway, which effects the lay-ups have had on the concerned market and what expectations the industry has on the future.
The ship-owners and shipbrokers active in the Norwegian offshore industry interviewed for this thesis have given a unanimous view of the current market situation as a supply-and-demand issue. Too many vessels in combination with too many ship-owners have contributed to a very high competition which has led to low rates on the spot market and difficulties finding long-term contracts. Out of the about 600 vessels in the Norwegian OSV-fleet, about150 have been laid up. The lay-ups have had a positive, but small, effect on the tough situation that the ship-owners are in, but there is a long way left until the market is in balance again. Moreover, bankruptcy and consolidation among ship-owners have occurred and are expected to continue. There are different opinions regarding whether a further increased oil price or not is what is needed for the ship-owners to regain profitability. None the less, there is a common opinion amongst the ship-owners that the oil companies’ activities must increase is the market is to be stabilised. },publisher={Institutionen för sjöfart och marin teknik, Chalmers tekniska högskola},place={Göteborg},year={2017},keywords={offshore-fartyg, Norge, upplagda fartyg, offshore, utbud, efterfrågan, strategi},note={38},}

RefWorks RT GenericSR PrintID 250326A1 Brattåsen, NicoleA1 Yahyaei Fard, MelissaT1 Den vilande offshoreflottan - En studie över orsaker till och effekter av fartygsuppläggning inom den norska offshorebranschenT2 The idle offshore fleet - A thesis on causes to and effects of laid up ships within the Norwegian offshore industryYR 2017AB Due to large oil supply and stagnating demand the oil price significantly decreased in 2014, leaving many actors in the offshore industry with a hard time finding profitability in their business. Among these actors are the many ship-owners who operate so called offshore supply vessels (OSV: s). These vessels are used to supply the offshore installations of the oil companies and assist with services such as anchor handling, tugging and repair & maintenance. The activity of the offshore installations in Norway has, since the oil price collapse, decreased to the extent that many of the vessels owned by Norwegian ship-owners no longer have enough work to cover their operating expenses. Ship-owners have therefore chosen to put vessels in lay-up. A lay-up means that a ship is temporarily taken out of service for a longer period, awaiting increased rates on the market. The thesis has studied the causes behind the laid up OSV-fleet in Norway, which effects the lay-ups have had on the concerned market and what expectations the industry has on the future.
The ship-owners and shipbrokers active in the Norwegian offshore industry interviewed for this thesis have given a unanimous view of the current market situation as a supply-and-demand issue. Too many vessels in combination with too many ship-owners have contributed to a very high competition which has led to low rates on the spot market and difficulties finding long-term contracts. Out of the about 600 vessels in the Norwegian OSV-fleet, about150 have been laid up. The lay-ups have had a positive, but small, effect on the tough situation that the ship-owners are in, but there is a long way left until the market is in balance again. Moreover, bankruptcy and consolidation among ship-owners have occurred and are expected to continue. There are different opinions regarding whether a further increased oil price or not is what is needed for the ship-owners to regain profitability. None the less, there is a common opinion amongst the ship-owners that the oil companies’ activities must increase is the market is to be stabilised. PB Institutionen för sjöfart och marin teknik, Chalmers tekniska högskola,PB Institutionen för sjöfart och marin teknik, Chalmers tekniska högskola,LA sweOL 126